The Pallet Network (TPN) continued to thrive in its first full year after being acquired by Eddie Stobart Logistics (ESL), according to its latest annual results.

TPN, which was bought for £52.8m by ESL in June 2018, reported a “strong year” in all areas, despite the impact of Brexit, with a rise in membership numbers and the continuing success of its regional hub strategy.

TPN’s latest financial results to 30 November 2019 revealed a rise in turnover to £129.3m in the year, compared to £84.5m in the previous reporting period, which, due to its acquisition by ESL, only spanned the eight months to 30 November 2018.

Pre-tax profit also surged to £6.3m compared to £3.2m in the previous eight months.

Pallet volumes grew well, the company reported, but saw a “discernible slowing down” towards the end of the year, which the network attributed to the uncertainties created by Brexit.

The directors also warned that the impact of the Covid-19 pandemic is currently having an “adverse” effect on the company which they are mitigating through the government’s furlough scheme and “other cost reduction measures”.

In its strategic report to the results, the directors said the company’s Brackmills hub in Northampton delivered “an extremely successful” first year of operations. The company currently operates 132 depots across the UK.

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The network also opened two depots in Stockton-on-Tees and Dagenham in the period, which achieved “high delivery volume growth” with the Dagenham depot primed to become a base from which electric vehicles could navigate London’s Low Emmision Zones.

The business also received a “high level” of new membership enquiries the report revealed, which resulted in ten new members joining the network. Total membership currently stands at 115.

Turning to the impact of Covid-19, the report said that the year-end sales ledger had not been impacted by the pandemic because of the length of time between the network’s year end on 30 November 2019 and the beginning of the pandemic lockdown on 23 March. It added that the directors would “continue to monitor” the situation.

Commenting on the annual results, MD Mark Duggan said TPN has weathered the pandemic well.

He told “Our volume dip during lockdown was lighter than we’d anticipated, and since mid-May volumes have climbed strongly and in June have hit record levels. We are now handling circa 20,000 pallets a night which was our original projection for 2020. Most importantly, the standard of service throughout lockdown was outstanding, which is a great testament to the resilience of our members and their teams."

Duggan praised members’ efforts during the lockdown and added: “All our members kept running and we maintained a full service. Our service levels remained extremely high.”

Turning to TPN’s hub strategy, Duggan said the company is currently extending the bays at its Minworth hub.

“Currently it can load/unload 40 trailers at once and we are extending the number of bays so that a further 17 an hour can be processed,” he said, adding that TPN has no plans at the moment to introduce further hubs to its portfolio but will keep the strategy under review.